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German Chancellor Merkel offers support for Canada-EU free trade deal

German Chancellor Angela Merkel wrapped up meetings with Prime Minister Stephen Harper with a promise to push for early completion of the gruelling negotiations for a Canada-European Union free trade pact.

Canadian Prime Minster Stephen Harper and German Chancellor Angela Merkel appeared cordial during a joint news conference on Parliament Hill on Aug. 16. (FRED CHARTRAND / THE CANADIAN PRESS)

Canadian Prime Minster Stephen Harper and German Chancellor Angela Merkel appeared cordial during a joint news conference on Parliament Hill on Thursday. (ROGERIO BARBOSA / AFP)

“We feel very much committed to this; we want a speedy conclusion of this agreement,” Merkel said at a news conference after four hours of talks with Harper on Wednesday and Thursday.

While the negotiations are taking place between Canada and European Commission officials, Merkel — as head of Europe’s largest economy — has considerable clout and her endorsement of the proposed pact was considered valuable by the Canadian government.

The free trade talks, while partly complete, are bogged down on pharmaceutical patent rules, intellectual property rights and trade quotas. Harper would like to have the deal wrapped up by year-end, but observers expect the negotiations to go into 2013. While Harper says such a deal would add billions of dollars a year to Canada’s economic activity, a Canada-EU pact would be controversial. Some fear higher pharmaceutical costs and tighter controls on copyrighted materials. Dozens of Canadian cities have also asked for an exemption from the agreement out of fear it would impinge on their ability to favour local companies for government procurement contracts.

Merkel, who told officials she came to Canada because it was “high time” for a bilateral visit, appears to have enjoyed cordial talks with Harper, an ally from numerous G8 and G20 summits.

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Both reported that in their discussions they did not link German support for the free trade deal with Canadian support for a special International Monetary Fund bailout plan for Europe.

Canada and the United States are the only G8 countries not to contribute to the $450-billion (U.S.) fund. Harper has said Canada does not intend to change its mind about contributing, maintaining that European countries have “the capacity and the will” to solve the debt crisis that is destabilizing banks and governments of countries such as Italy, Spain and Greece. Merkel said it would be “very wrong” to try to link the IMF bailout to Canada-European issues.

Echoing remarks made by Finance Minister Jim Flaherty on Wednesday, Harper said “there are additional things that have to be done” by European policy-makers to end the economic chaos on the continent.

But he toned down his earlier criticism of Europeans for acting too slowly to address the crisis, saying he believes the continent’s leaders are committed to overcoming the financial troubles threatening the future of the 17-country eurozone.

And he threw his support behind Merkel in the current political struggle in Europe, where she is holding out for tougher austerity agreements for debt-plagued countries seeking bailout funds from their neighbours.

“One of the things I appreciate about Chancellor Merkel’s leadership is the willingness, including at times of urgency and stress, to not just find any solution but to find correct and good solutions,” Harper said. He added that Europe needs long-term solutions that reduce government indebtedness, improve overall economic efficiency and do not reward countries for bad fiscal performance.

Merkel, a former environment minister who has fought for years for more strenuous action to address climate change, told the media that “we need to do everything we can to reduce CO2 emissions.”

But she took a strictly neutral position on the thorny issue of Canadian oilsands production and the EU’s proposed fuel quality directive. The EU’s anti-pollution directive, which would classify oilsands-derived crude as “dirtier” than other petroleum, is seen as discriminatory by the oil industry. And the Canadian government has lobbied hard against it in Europe.

In the news conference, Merkel said she and Harper discussed the controversy. Germany is “familiar with the problems that there are with respect to the oilsands,” she said but added that she’s aware other forms of resource extraction also add to greenhouse gases. She and Harper agreed that any sanctions against oilsands crude must be based on a “solid scientific foundation.” European officials recently put off a key vote on the fuel quality directive to allow for more scientific assessment in advance of a decision next year.

Merkel met with Harper on Wednesday evening at his summer residence at Harrington Lake, Que. On Thursday she made a courtesy call on Governor General David Johnston at Rideau Hall. After more meetings with Harper, the news conference and a luncheon on Parliament Hill, Merkel was scheduled to fly to Halifax, where she visits Dalhousie University and will preside over the signing of a research partnership between Canadian and German scientists.

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